We discuss the identification and estimation of discrete games of complete information. Following Bresnahan and Reiss (1990, 1991), a discrete game is a generalization of a standard discrete choice model where utility depends on the actions of other players. Using recent algorithms to compute...

We design a laboratory experiment to investigate bilateral link formation in a setting where payoffs are pair-specific. Our link formation rule is decentralized and players can make link offers and counter-offers, as in a Beckerian marriage market. The game is designed in such a way that a...

This paper studies nonparametric identification in binary choice games of complete information. We allow for correlated unobservables across players. We propose conditions under which the binary choice game is a so-called potential game and impose that the selected equilibrium maximizes its...

We argue that standard modeling practices often overstate the potency of general-equilibrium (GE) mechanisms. We formalize the notion that GE adjustment is weak, or that it takes time, by modifying an elementary Walrasian economy in two alternative manners. In one, we replace Rational...

We examine the capital-market effects of changes in securities regulation in the European Union (EU) aimed at reducing market abuse and increasing transparency. To estimate causal effects for the population of EU firms, we exploit that for plausibly exogenous reasons, like national legislative...

Revealed preference arguments are commonly used when identifying models of both single-agent decisions and non-cooperative games. We develop general identification results for a large class of models that have a linearly separable payoff structure. Our model allows for both discrete and...

Building on theories of international relations, we analyze how mistrust (uncertainty about an adversary's preferences or capabilities), misperception (imperfect observation of an adversary's actions), and misunderstanding (non-degenerate higher-order beliefs) can lead to conflict and drive its...

Just and efficient allocations of charity have attracted much academic and media attention. The sources of inefficiency and unjust are important to understand yet understudied. Our study aims to fill this void by directly modelling the victims' market in a collective reputation framework. By...

We study how people think others update their beliefs upon encountering new evidence. We find that when two individuals share the same prior, one believes that new evidence cannot systematically shift the other's beliefs in either direction (Martingale property). When the two have different...

We use response curves in a repeated game to analyze key aspects of mutual deterrence: escalation, de-escalation, incomplete deterrence, and deterrence by denial. In this approach, episodes of violence are due to interacting response curves, which disincentivize opponents from attacking through...